Research and Theoretical Review of Equity Incentive Performance of Listed Companies

Abstract

Equity incentive is an incentive method for listed companies to promote the alignment of key management personnel and enterprise interests, and scientific and reasonable equity incentive methods can promote managers and core employees to better serve the company, promote the formation of a community of interests between shareholders, management and employees of the company, and contribute more to the development of the company. At the same time, due to the serious differences between shareholders and corporate executives in the pursuit of interests, it is difficult to establish a full relationship of trust between shareholders and corporate executives, which seriously affects the enthusiasm of corporate executives and leads to low company performance. In order to avoid similar phenomena, the equity incentive mechanism came into being, becoming an indispensable part of listed companies and an important prerequisite for listed companies to improve their governance structure. In recent years, with the development of the market, China’s listed companies have gradually realized the importance of equity incentives for the development of enterprises, and more and more listed companies have begun to apply the tool of equity incentives. In this field, scholars have also achieved fruitful results in theoretical research and performance analysis of equity incentives. This paper sorts out the literature on equity incentives of listed companies by clarifying the significance of equity incentives for listed companies, the main models and main theories of equity incentives. Based on the existing literature and company data, this paper also theoretically explains the current situation of equity incentives in China from multiple perspectives in combination with relevant theories.